The naked economics of Lindsay Lohan

No, seriously: Li-Lo's latest photoshoot can teach us a thing or two about the world of online business...

by
Last Updated: 31 Aug 2010

When wild-child Hollywood ‘starlet’ Lindsey Lohan agreed to recreate a famous Marilyn Monroe nude photoshoot for New York magazine (which in celeb terms constitutes a pretty major scoop) the online world sat up and took notice. Since posting the pictures on its site last weekend, New York’s website has been deluged with hits from around the globe – depending who you believe, the site has seen its daily average of 1m hits increase by a factor of about 20.

Our immediate thought (after painstaking research of the site in question) was to wonder what the economic upside was from all this. Surely there must be big rewards for a commercial organisation if their website suddenly brings in an extra 50m-odd users?

Online advertising revenue is one obvious area. The banner ad under the Li-Lo slideshow (currently Diane von Furstenberg, at time of writing) has a list price of $15 for 1000 page impressions – so 50m of these would generate revenue of about $750,000. Unfortunately for New York, however, it probably hasn’t done that well. The actual price charged will probably have been much lower – and most advertisers will pay for a certain number of page impressions (which ensures they don’t get stung if something like this happens). Once this runs out, a site will often re-sell the space to an ad server like Google or MSN – which will make even less money. Still, the site must have made a decent sum.

Another possibility, of course, is increased sales of the print magazine. According to Forbes, it’s had an extra 5,000 copies printed to cope with single-issue orders. And then there’s news-stand sales – the magazine hit the shelves on Monday, so we’ll soon see what the impact has been. We’re guessing that the mag is likely to enjoy a sizeable sales boost.

On the other hand, there are probably also some costs associated with such a massive spike in web traffic. A site that’s set up to handle a certain number of users might not have the bandwidth to cope with a 5000% increase – chances are that some IT gurus were working overtime to stop the site from falling over.

And will it actually be able to turn any of these one-off visitors into regulars? Will any of these internet users keen to see Lindsey in the buff return next week to enjoy what New York has to offer? Given that there’s relatively little attempt to direct users from the shoot towards other areas of the site, we can’t help feeling this is unlikely.

Then again, if you’re a magazine that’s two letters short of being a much more famous magazine, perhaps it’s all worth it to improve your brand recognition...

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Subscribe

Get your essential reading delivered. Subscribe to Management Today